Gold continues to show little movement, as the spot price stands at $1193.33 in Monday’s North American session. On the release front, the US released the Labor Market Conditions Index, a new economic indicator which the Federal Reserve introduced in October. The index fell to 2.9 points in November.
US employment data looked superb on Friday, as Nonfarm Payrolls shot up to 321 thousand in November, stunning the markets which had expected a rise of 231 thousand. There was also a rise in wages, which translate into stronger inflation numbers. The unemployment rate held steady at 5.8%, matching the forecast. The excellent Nonfarm Payrolls should help allay concerns about whether the economy can weather an expected rate increase in 2015.
On Thursday, ECB head Mario Draghi adopted a “wait and see” attitude, saying that that he had no plans to implement quantitative easing for the time being and that the ECB would review its stimulus program in early 2015. The euro shot up about 130 points following the news, although it later gave back some of these gains. The ECB also downgraded its forecasts for growth and inflation, and if the Eurozone economy fails to improve, there is a reasonable likelihood that the ECB will embark on the QE route. Meanwhile, there was some unexpected good news from Germany on Friday, as Factory Orders climbed 2.5% in October, marking a three-month high. This is easily beat the forecast of a 0.6% gain.
XAU/USD for Monday, December 8, 2014
XAU/USD December 8 at 14:25 GMT
XAU/USD 1193.33 H: 1198.85 L: 1188.85
- XAU/USD has shown almost no movement on Monday, as the pair trades slightly below the key 1200 level.
- 1175 is an immediate support level. 1156 is next.
- 1200 is a weak resistance line. 1215 is stronger.
- Current range: 1175 to 1200.
Further levels in both directions:
- Below: 1175, 1156, 1130 and 1111
- Above: 1200, 1215, 1240, 1255 and 1275
OANDA’s Open Positions Ratio
XAU/USD ratio is pointing to gains in short positions on Monday. This is not consistent with the pair’s movement, as gold has posted small gains. The ratio is made up of a majority of long positions, indicative of trader bias towards gold moving higher.
- 15:00 US Labor Markets Conditions Index. Actual 2.9 points.
*Key releases are highlighted in bold
*All release times are GMT